Diversification is not about how many positions you hold — it is about how differently they behave. Ten tech stocks that move together are one big bet, not ten independent ones. Here is what correlation actually measures and why it decides your real risk.
Short selling means borrowing shares, selling them, and buying them back later. Here's the mechanic, the borrow fees, and the asymmetric risk profile that makes it fundamentally riskier than owning stock.
A stock index is a single number that summarizes the price action of a basket of companies. The S&P 500 tracks roughly 500 large US firms, the Nasdaq-100 tracks the 100 largest non-financial names on the Nasdaq exchange, and the Dow Jones Industrial Average follows 30 blue-chip stocks.
Every quarter, publicly traded companies publish earnings reports that reveal how much money they made, how much they spent, and what they expect going forward. For traders, these reports create the biggest single-day price moves of the year.
Stock options give you the right to buy or sell shares at a specific price before a specific date. They are contracts, not shares. That distinction changes everything about how they work, how they are priced, and how they can lose you money.